Keith Hudson's Musings

Stabilisation by default

The world economy has to stabilise sooner or later. There’s no economic law that says this. A far more fundamental set of laws — namely the collective laws of physics, incorporating the law of least effort — says this.

Maybe we have already largely reached a point of stabilisation with a major division of labour between China, shortly able to make all the physical products of the world for those who can afford them, and about a dozen of the advanced countries — by virtue of scientific research — able to keep on developing the sophisticated services of the world for those who can afford them.

This can never be proved conclusively This can only be disproved by the American, Japanese and European central banks rising out of their present condition of paralysis and telling their governments what to do. The longer that near-stabilisation goes on, the more that the case will be proven by default.